Microsoft Return to eBooks Via Nook

The breaking news that Microsoft have bought heavily into Barnes and Noble to create a new venture which encompasses their Nook, digital and college business is shall we say a surprise and a significant move for both parties. Microsoft will invest some $300 million for a 17.6% stake in the new venture which will be valued at some $1.7 billion.

Obviously, the dust has to settle and much has to be revealed, but it has obvious to many that B&N needed a partner with clout and deep pockets and Microsoft certainly can bring that to the table, but they also needed a global partner and Microsoft ticks that box too. Microsoft also needed to get back into the mobile marketplace but had previously walked away from ebooks at  that famous BEA in 2008 when they literally dropped Windows BookSearch.

So B&N divides, its business gets some cash, raises its valuation and gets a big brother with only a minority stake today and potential for more investment in the future. That is certainly good business for B&N and one which must seem like Christmas to their investors.

The questions are now about speed, focus and how Microsoft’s interests are projected onto an Android platform. We still have to see how the international offer develops and the sixty four dollar question remains over Microsoft’s sticking power and whether if the going got tough they would simply walk away again.

Is Publishing Experiencing Its Own Arab Spring?

The Arab spring swept across many Arab states and was driven by the confidence that others had succeeded and maybe they weren’t alone.

It has always been true that much of publishing tends to be ultra cautious, but when it turns, it does so quickly and often on mass. Things we thought were never going to happen, suddenly start to be talked about, the evangelists spread the digital word and one player moves, watched closely by many others. If the noise is positive and the resistance small, the change can happen and we all become born again believers. It’s as if everyone is constantly waiting for someone to dip their toe in the pool of opportunity and watch if they sink or swim.  

The latest cry of ‘me too’ would appear to be surfacing around DRM. Is it born out of the final acceptance that DRM is an inhibitor and not an enabler, or that it is often seen by the consumer as a pain to deal with and a straightjacket to work within, or the fact that music went DRM free and the market didn’t die, or by authors demanding it? For everyone you speak to, their will be many and often different answers and the arguments that supported its adoption are like yesterday’s regime support – forgotten.

Has anything fundamentally change to promote this new enlightenment and movement?

Yesterday, Tom Doherty Associates, sci-fi publishers of Tor, Forge, Orb, Starscape, and Tor Teen and part of the Macmillan trade empire announced that by July, their entire list of e-books will be available DRM-free. Their logic was that there authors and consumers were a technical savvy group and had demanded it for some time. DRM was cited as an inhibitor. We will not know if this was a shrewd move by Macmillan to test the market in a controlled vertical, or they just woke up one morning to a cathartic moment and realised what they stakeholders wanted.

Now every digital evangelist, industry thinker and consultant is jumping on the bandwagon and the state of DRM could be in for a bumpy ride and possible a people’s Spring, or maybe Summer, uprising. 

It is interesting that once again many are talking about the removal of the strict DRM regime as an opportunity to clip Amazon’s wings. The truth could be very different and the move to DRM free MP3 helped Amazon in its music business against Apple’s iTunes, but even iTunes, when they finally changed, were not significant impacted. DRM itself has nothing to do with stimulating or suppressing market competition. It is naïve to link them as closely as some have, or perhaps they are jumping on that other Spring uprising of anti Amazon feeling.

So lets think about a DRM free world? Are we dismissing ‘soft’ or ‘social’watermark DRM too, or is it just the hard encrypted and hardware specific DRM?

It’s often hard to gauge the feeling of the crowd, but what is clear is that hard DRM is fast loosing support even quicker than some Arab regimes did in their uprisings. Will this lead to an explosion of piracy? We think piracy will increase but will not be driven by the lack of DRM so much as the issue of pricing and other variances to the physical rendition. Let’s finally face it, a serious pirate will rip it irrespective of DRM and increasingly individuals will rip it if they feel it justified. The markets with most to fear due to their high ticket price; education, academic, professional, also could have the greater opportunity to minimise the risk. These sectors are moving away from the 'tome in a straight-jacket' to an environment rich with interactive media and links. They are now, or should be, raising the added value of a media and rich platform and leaving behind the commodity featureless tome.

What remains interesting is that this potential uprising is taking place against the backdrop of the sales ‘honesty box’ and lack of rights registry. We must recognise that making fundamental changes in one aspect will have a knock on impact in others and without considering these and taking some action, the sprit of the uprising, could sour as authors find reconciling sales unacceptable and potential infringement under ever stone. Publishers will have to step up their legal diligence and actions, which mean increased cost and resource and small publishers may have to act co-operatively, or face some often scary digital reality.

Agency Mud Sticks?

Searching for clarity on the DOJ Agency debate is often like searching for the Holy Grail and wherever one turns one finds opinion based often on vested interest more than independent judgement. So it was great to read Jane Little’s ‘Antitrust Primer for the Publishing Price Fixing Lawsuit’ article on the case. Jane has taken the legal points made by the DOJ, reviewed the anti trust legal position in the US and has crafted a piece we would recommend all to read.

Some 15 U.S. states plus Puerto Rico are apparently in settlement talks with the three publishers who have opted to settle. This action itself could impact on the separate class actions that have been lodged in the US. There is speculation as to the motive behind these settlement talks and some such as Alison Frankel suggest that they made be designed to undermine the class action cases.

Interestingly two Canadian law firms have now named Apple, Hachette, HarperCollins, Macmillan, Penguin, Simon & Schuster, and their Canadian subsidiaries, in class action claims that they colluded to “fix, maintain, increase or control the price of ebooks”. The filing claims that the action contravenes the Canadian Competition Act which makes it a criminal offense to enter into a conspiracy with competitors that increases prices. The Canada’s Competition Bureau has not declared if it is probing Apple or the publishers.

The European Commission stated last week that it had received settlement proposals from Apple and four publishers; Simon & Schuster, Harper Collins, Hachette Livre and Macmillan. Interestingly this further settlement could include Apple and Macmillan who have not settled in the US and have opts to have there day in court.

So we have different perspectives in different geographies which are obviously driven by different laws. However, the news has raised the profile of ebooks within the general public for all the wrong reasons and whether we like it or not has it has again raised question of pricing in the mind of the consumer. Anyone who remembers the initial CD pricing debacle in the UK will know that mud unfortunately sticks.

Internet and Mail Order Costs Are Rising Too!

We often hear about the constant cost pressures on the High Street and the claims that brick and mortar retail is at a cost disadvantage. Perhaps realty is not as clear cut as many think.

Mail order has been under constant cost rises which are forcing the traditional catalogue online. It is not the consumer switching to digital that is driving this as much of the constant rising cost of paper and postage. We may moan about the number of printed catalogues we receive, but each one is costing at least 10% more to produce than it did last year and in the UK, thanks to some exceptional steep increases from Royal Mail it is costing some 25% more to deliver. As mail order operators look to find new ways to get their inventory in the homes more catalogues are now being inserted with other materials and catalogues in an attempt to share costs. However it’s the weight the determines the price paid so sharing is more about speculation for new customers than reducing costs on existing ones. A catalogue doesn’t guarantee an order and even regular customers can often become irregular but they all still need to be mailed. Without the catalogue the retailer is not reminding his customer that he is there and showing them new products and offers.

We live in an increasingly mixed marketing environment. Research from Marketing production form Charterhouse suggests that 70% of marketers use printed media to interest audiences in online content and to drive extra web traffic. Catalogues4Business claims that their recent research highlights that businesses still see catalogues and direct mail in general as an important part of their marketing mix. Their MD Ian Simpson says, ‘While many customers place their order online or by tablet or smartphone, the trigger is very often a catalogue or piece of direct mail.’ Clearly Google Ad words only goes so far and is great for search and discovery of specific products but doesn’t create spot buys or cover the items the customer didn’t know the retailer had on offer.

However, once the customer has bought online or offline, the goods have to be picked, packed and shipped to them. Here we find another urban myth, that shipment is ‘free’. Sadly it isn’t and increasingly this cost is rising far greater than any inflation benchmark.

Yodel, which distributes 25% of the market in the UK, handles some 1.2 million parcels a day at peak times and its contracts include the likes of; ASDA, Amazon, TESCO and Littlewoods. Yodel has some 55 depots and employees 14,000 staff. Two years after buying up the competitive DHL Domestic parcel business is now seeking a “double digit per cent” hike in its fees. Their pressures are many but they claim the sheer volumes alone are making their current model unprofitable. They state that the UK infrastructure is not developed sufficient to handle the current explosion in online shopping. They also see the need for thousands more local collection points, the introduction of six days a week delivery and the choice of morning or afternoon deliveries and customer text updates.

It’s a sobering thought that each order is today exposed to potential service cost increases of some 30%. The lower the value of the order the higher the margin impact and books are in the main not expensive items. So as we listen to increased cries of unfair from the High Street remember the direct mail and internet channel is also experiencing cost increases and not everyone is 100% virtual.

Cartoon with kind permission of BibliophileBooks.com

Would You Buy A Nokia Smartphone Today?

In the wider technology and corporate world there are significant changes taking place which should act as a warning to all that no one’s future is guaranteed and that everyone is judged by not what they delivered yesterday but what they deliver today and tomorrow.

Yesterday, we saw a brash Nokia stand boasting much but delivering little at the London Book Fair. It is somewhat delusional of them to believe that they are ready, or even offer a viable proposition in the dynamic digital market. They may have technology, but it’s the technology that is not in demand today and its consumers they need to convince.

It was only a short time ago that Nolkia were the mobile of choice, they dominated the global market and appeared not to put a foot wrong. Then came the iPhone, apps, Andriod and the market changed. Nokia made some wrong moves, bet on their leading position and technology and with a series of operating system gaffs bet on losers. It is very questionable whether their switch to Microsoft will save them and we see two former world champions not capable of getting into the ring with the new contenders.

This week Nokia’s credit rating was cut by Moody’s to Baa3, which is one step away from non-investment level. Compounding this bleak position a profits warning last week knocked 20% off Nokia share prices and as iPhone and Andriod sales continue to rise Nokia’s smartphone sales have now halved in a year.

Nokia remains liquid and maintains a strong capital structure, but desperately needs to reposition itself in the market which may be difficult. It has the capability to bounce back but can it be a force against an Apple and Google dominated market? The two things that are certain about tomorrow are that we will be older and change will happen and what is increasingly uncertain is who will succeed, fail or even survive the journey.

The Organisational Impact of Digital

The changes in the technology market are somewhat frightening and swift and organisations we once expected to last for ever, or were seen as the new role models can soon wane. We remember, the first ‘Publishing in the 21st Century’ research paper , The organisational Impact of New Media’. We helped those stalwarts, Mark Bide and Mike Shatzkin galvanise their thinking. Then we looked at a digital world that was going to happen, some 15 years later, we now face an exploding digital market.

Only this year we have seen Kodak hit the digital wall this year.

We have also seen Nokia struggle to find the right mix as others swallow up their once dominant market share.

It is sobering that this week Facebook, in acquiring Instagram, valued the 15 month old company of 13 staff at a staggering $1 billion.

We have seen the innovative Sony in the doldrums with four years of losses. At the end of March 2011 Sony had some 168,200 employees. Now Sony has announced it is to cut some 10,000 jobs, which equates to some 6% of its workforce. Only last month Sony said that it was selling a chemical products division, shedding some 3,000 people and earlier it merged its Sony Mobile Display business with Toshiba and Hitachi to form Japan Display and in doing so effectively shed a further 2,000 jobs. Job cuts and reorganisations are not new at Sony. In the Global Fincial Crisis at the end of 2008 they shed some 16,000 employees.

We often think of businesses in simple terms of turnover, employees, profit, but today these can be inhibitors, which make the ship heavy and difficult to tack quickly whilst others prove far more nimble and react to changes far quicker.
This week many are debating the perceived justice or injustice of the DOJ decision on the ‘Agency’ pricing model. What may be more interesting is to debate the organisational changes that will have to happen within ‘publishing’. Big is not always best and not all of today’s players will make it to tomorrow. What is the ideal publishing organisation of tomorrow? How will it be structured different from today? What will the difference between the various sectors? Who will be best positioned to seize the new opportunities?

What is clear is that change is not just about content and seize is not about people but how you deploy them.

Agency Wake Up Call

Yesterday was a sad day and somewhat a watershed for publishing. The judgement of the US Department of Justice was inevitable and seen by many as the only conclusion they would have reached. Three publishers settled to an agreement which on the face of it looks to be a bit of a muddle of a compromise, which itself is probably going nowhere fast and has compliance officers and reporting strings attached. Two publishers Macmillan and Penguin decided to fight on and John Sargent, CEO of Macmillan , issued an open letter to staff and authors which spoke of his moral stance, but omitted any mention of the thorny issue of the ‘most favoured nation’ clause. Apple has the money to stand its ground and some would suggest can only operate on a simple pricing structure such as offered by agency commission.

Yesterday was not what is being declared be many as a victory for Amazon, but was a victory for consumers. Amazon will now have all the ‘good and mighty’ on their backs and will probably be openly pillared by many within for bringing down their ‘white knight’ agency model. The reality is that if Amazon had not played the discount card someone else would have.

What we all must be wary of is the price and offer to consumers and avoiding any knee jerk reaction which will further raise consumer challenges over price. Consumers will in the main always side with price and service over maintaining any legacy industry infrastructure. The library lending issue of ebooks hasn’t gone away and consumer groups can do the maths and may conclude that resistance to change is greater than finding solutions to enable it. We also still have an industry that is front list orientated and often in denial over used books, bargain books and often back list. The strength of the offer is in depth and range and not just the latest and celebrity tie ins.

We all often side where are interests best served but we must remember that the only two that ultimately matter are the author who creates in the initial value and the consumer who values the end result and pays for it.
The filing is now available here:

The filing is now available here:
Infodocket.com
Scribd

Facebook Buys Instrgram For $1 Billion

One of the most popular apps Instagram has been bought by Facebook for a cool £1billion.

We have all become happy to share our thoughts via blogs, twitter and Facebook, our business contacts via LinkedIn, our social circles via Facebook, our videos via YouTube and our photos via Facebook and Instagram. Instagram has been downloaded and used by a staggering 27 million people, including many celebrities. In fact, the app has only just been released onto the Andriod platform and we only downloaded ourselves this weekend. So in theory the app has the potential to double its audience!

The app is like Adobe Photoshop plus much more and allows users to alter and post images on their smartphones and tablets. It offers stylistic filters, frames, and special effects to photos. Options can transform a straightforward snapshot into something very special.

Kevin Systrom, the the 26 year old CEO, who turned down an offer to join Facebook in 2004, founded Instagram only 15 months ago. With only 13 employees, Systrom now has hit the $1 billion jackpot. Systrom also retains 40% of the company and lands £400million from the deal, which values the business more than the likes of the New York Times!

Although Facebook has a reputation for buying up start-ups and then integrate the technology Systrom has reassured users that Instragram will continue to exist independently of Facebook and will continue to add new features to the product. Facebook CEO, Mark Zuckerberg commented , ‘This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users. We don't plan on doing many more of these, if any at all.’

As we develop our social skills it is going to be very interesting to see how ownership and privacy evolves. What is clear is that a handful of services will know a significant amount about us which can be used both positively and negatively and how much control the individual ultimately has will be very interesting to watch.

Indies You’ve Been Googled!

The marriage of Google Books and Indie Bookstores tied the knot between, the bride who brought her wealth of stores and customers and the groom who brought his technology and ebooks. Was it an even relationship founded on common understanding and shared belief in each other, or merely a hastily arranged mis-marriage born more of convenience than love and probably never consummated?

This week Google started divorce proceedings based on the indies not delivering sales.

Unrequited love, often drive the groom to seek pastures new and in this case Google has declared that it will start to sell e-books solely through its recently launched Google Play beginning January 31, 2013. Will it makes the envisaged sales it believes it can do better on its own or will it find the market will has moved on further and Google is not the ebook force it once envisaged?

The bride will no doubt be unindicted by new suitors hungry to convert the dowry on offer. However, will these wanabees fair any better, offer a true relationship or once again follow in the footsteps of Google when their expectations are not met. It is easy to see a line of ‘white label’ suitors who all will offer books and technology. How will any of these differ from what went before? It is often said that if one rushes on the rebound from one broken relationship to another, with the next one being to someone very similar to the first.

When we wrote the Brave New World report in 2006 we saw the opportunity for booksellers to embrace and deliver the digital opportunity. Then it was possible to see strong partnerships that could have matured, but today the landscape is very different and although the pie has grown significantly the opportunity to cut a sizable slice of it has diminished for many. We did discuss the opportunity for bookstore to build their own platform and take control of their own destiny but it was felt that marriage was more rewarding than remaining single. In hindsight we wish we would have been more forceful and argued the case stronger as a booksellers digital repository tied to stores and consumers would have had strong market appeal and perhaps would have attracted a more equal suitor or offered a stronger relationship.

The opportunity is not lost, nor should anyone dismiss the wealth on offer, but it takes strong leadership and vision now to move the indies digitally forward. The UK and US do not have the security of the Centraal Boekhuis relationship but can learn much from it. The stores themselves need to recognise that white ‘label stores’ only offer a commission not a marriage or partnership. It’s somewhat ironic that the two parties, libraries and bookstores, that are now playing the dating game, are potentially still the strongest bodies if they can the pull all the pieces together.

US Survey Says… ebooks readers read more and much more

We know that readers are reading more ebooks in the US, but now new research gives us some interesting insights into their behaviour and their use of digital and physical content. Some 30% of those that read econtent claim that that they now read longer, with some 41% of tablet readers and 35% of ereaders readers claiming to be reading more. The research claims one-fifth of American adults (21%) have read an e-book in the past year, which is an increase of some 4% on those who, in December, claimed to have read an e-book in the previous year. This is probably understandable given the amount of devices that were received as presents over the Holiday and Christmas period.

Is it surprising that those who read ebooks, read more books than those who don’t have devices? One would assume that those who have bought the devices would have done so to read and therefore would be readers and gifts would be probably given to people who are know readers, so it’s not surprising that they have used the devices and even have read more as they go through their early adoption phase. The figures make one assume the survey demographic chosen are heavy readers, but the figures given are that the survey included readers who had read; only 1 book (8%), 2-3 books(17%), 4-5 books(16%), 6-10books (19%), 11-20 books(18%) and over 20 books (22%).

The first interesting point is that that those of who read an e-book in the past 12 months, some 42%, did so on a computer. This compared to those who used an ebook reader (43%), a smartphone (29%) and a tablet (23%). This issue is however is whether the high level of computer reading is down to transition and adoption of new devices and if it was consistent over the full year.

The next interesting point claimed by the research was that some 88% of those who read an e-book also read a printed book. Of those surveyed, 14% claim to have read both printed books and e-books. Overall, over the year, 72% of adults surveyed read a print book, 21% read an e-book, and 11% listened to an audiobook.

The research also looked at the reading behaviour and why readers read ebooks. Again we could suggest that 2011 was a transient year in the US and although the research claims book readers are more likely buy their most recent books (48%), rather than borrowed them (24%), or loan themt from a library (14%), we have yet to see the real loan, rental and alternatives such as ‘on demand models’ in the market. DRM still remains a borrowers and consumer nightmare and today will constrain borrowing. However, it was interesting that those how read both physical and digital books preferred e-books when they sought convenience to buy quickly, when travelling or commuting and when they wanted to review a wide range of titles. As for that favourite reading place the result was split with 45% prefer reading e-books in bed, while 43% prefer print.

Book recommendations clearly should be a wake-up call for all those that believe that we are still in a mass market community. The vast majority, some 81% of ereader and tablet owners, get recommendations from ‘friends and family’. This also applies to non ereaders surveyed (64%) too. On line bookstores and web sites were high influencers with 56% and 28% respectively but physical bookstores and libraries had far less influence (31% vs 23%) and 21% vs 19%) respectively. Social networking and usage of friends and family is an obvious pivotal key for all.

The main reasons given by those who do not own ereaders and tablet devices are; they don’t need or want one, they can’t afford one, they have enough digital devices already, or they prefer printed books. Not exactly rocket science but confirms what we probably already knew. The survey found that 19% owned a reader and same number owned a tablet but it didn’t identify how many owned both. Of the tablets 61% were iPad and 14% Kindle Fire 14% with the Nook only registering 1%. Of the reader devices Kindle were 62%, Nook 22% and Kobo and Sony only 1% and 2% respectively. Of the adults who did not own a tablet 10% plan to buy one in the next six months and a further 8% eventually, whilst 8% who don’t have an ereader plan to purchase in next 6 months and 5% eventually. This would indicate that there is still significant device growth and that Amazon is very well positioned in both segments to achieve further growth in the US. What it clearly says also is that the device battles are clearly down to Apple versus Amazon today. How that may shift over time will be interesting to watch and also what happens with the great unread will be even more interesting to monitor.

It was a pity that the question of DRM appears to have not been covered, along with the question of perceived ownership versus licence and the lack of ‘first sale doctrine’. These are perceived consumer issues and this would have been a great opportunity to gauge consumer perception.

Finally, the survey also claims that although econtent is relatively easy to find, 23% of those who read ebooks, digital newspapers, magazines, etc. can’t find what they are looking for or its not available in the format they require it. Although the detail is somewhat ambiguous the message should be noted.

The research may not be news to many but what is important is that we monitor these social changes in reading habits and understand the market trends.

The research was prepared by Princeton Survey Research Associates International for the PEW Research Centre’s Internet and American Life Project and the Gates Foundation. The project was underwritten by the Bill & Melinda Gates Foundation.

Will eBooks Loose Their Triple 'A' Status?

If the ongoing DOJ negotiations with the gang of five as expected take away Apple's "most favoured nation" status, which prevents the publishers from selling e-books through rival retailers such as Amazon, Barnes & Noble, Kobo etc for less.

It will almost certainly reduce the ability of publishers to control prices. This will almost certainly lead to a resumption of skirmishes between some parties and reduce market prices.You could say that the market will certainly loose its triple 'A' status (Apple Agency Appeal).

The question of whether we shall see a return to $9.99 ebook pricing is not so important as the one as to what any removal of the status will do to Apple’s commitment to ebooks. Apple are unlikely to dominate the ebook market and like to keep things simple. They are not retailers and playing in an open market is unlikely to be appealing, will be very demanding and not very profitable. The ebook market is very small in Apple’s revenues and is unlikely to grow exponentially with the removal of agency.

We all have to wait for the Justice Department and the EU Commission’s judgement but is looking increasingly like that an agency model will stand as constructed today but the most favoured nation may only consist of one.

Public Library News: April Fools?

April Fools Day always raises some dubious claims, which have to be carefully considered before they are accepted as genuine. It was therefore somewhat an unfortunate day for the Public Library News blog to post a report into a panel discussion on the future of public libraries held under the Arts Council England (ACE). Perhaps they just couldn’t wait another day and thought the news to hot to handle, or perhaps it was a spoof.

What we found interesting was that they seemed to have dropped the ‘book’ and moved onto ‘community centres’. The ‘core services’ were about ; civic engagement, transformation, getting people back to work, promoting health and repeatedly they have some weird obsession with 3D printing and fab-labs .

It certainly didn’t describe a library as we know it today, or yesterday and books were brushed off as being "the given". On one hand they wanted to ‘engage more with e-books and encourage "live" literature such as author visits’, but on the other saw acquisition, cataloguing and librarians as past their sell by date. They state that ‘other people offering these things (books). Why should a library offer them too?’

The more we read, the more convinced that it must be an April Fools Joke. The thinking was far from joined up and somewhat all over the floor. So on one hand we have real estate and inventory and folk who are trained to relate this to the community and on the other thinking that say we can role up the Citizen’s Advice Bureau, the civic crèche, the Community Day Care Centre, the Tourist Information Centre, the Job Centre, whatever into one building and call it a library. Forgetthe books its more about the service. Its as if thinking 10 years out they believe the community will still be physical and need a building or that ‘books are a given’ but don’t need curators and people interested in them to manage the service. We fondly remember when librarians became ‘Information Officers’ and wonder if the same hands are on this tiller.

The Public library service is what it says on the tin and changing that redefines its role, who it employees, its financing, and who its customers are. The panel discussion clearly lacked vision, mission and operation today and it’s a shame as it has potentially a huge role to play in the digital age and one far more engaging than 3D printing.

Their conclusion was that, ‘the argument in the country tells you what passionate feelings have about their libraries. Makes it important to discuss. We need to get thinking for "not tomorrow" but for 5 or 10 years time.’ Ours is that they should get today’s thinking joined up before they dream like little children on what they want to be when they grow up.

Bibliophile Celebrates its 300th

At a time when many predict the death of the physical book and the bookshop and even the public library is under constant threat of closure, Bibliophile Books continues to prosper and go about its business as the UK booklover’s greatest secret. In 2011 it was granted a Royal Warrant by the Duke of Edinburgh in recognition of its quality, service, and excellence. It has been selling to the palace for some 20 years. This year on March 25th, some 34 years after it published its first mail order catalogue, it will achieve a significant milestone and celebrate the publication of its 300th catalogue.

In today’s crazy discount wars Bibliophile is about ‘everyday low pricing’ and reader value. Most titles including well-received biographies are under a fiver, making reading an affordable adventure and a lifeline service to the disabled and housebound and those who miss browsing in their local bookshop which may have closed down in recent years. However, certain titles are rare and collectable and will never be printed again like the magnificent Splendours of Iran (slipcased) published £350 at £200 and JOHN JAMES AUDUBON PORTFOLIO $1400 now £275 containing 48 loose leaf prints and book in giant slipcase.

Today Bibliophile is not just a mail order catalogue. It has just launched its second generation website, has digital newsletters, integrated email communications with customers, an active presence on Facebook, Twitter, Kindle and has created over 200 YouTube unique video book reviews which have attracted over 70,000 hits and really do show what what the book looks like inside the jacket!. They have even published books and now ebooks and plan much more.

Over half a million Bibliophile catalogues a year are distributed to tens of thousands of members all over the UK and as far away as New Zealand. Cheap and cheerful, the founders chose a newsprint tabloid format, pithy quotes humorous anecdotes and succinct in house book reviews to tempt book addicts worldwide to sample the best selection culled from publisher's front and backlists, remainder dealers, plus overstocks from a variety of sources.

Each 40 page catalogue is printed on environmentally sourced 100% recycled paper and
contains some 300 brand new books and over 1,000 titles. Every book review is written in house, reflects the Bibliophile’s unique style and is aimed at reflecting why Bibliophile selected each book and is selling it. The books cover some 30 subject categories and were published in the UK, US and Canada and include war, history, biographies, art, crime, Britain, crafts, literature, fiction, children’s, CDs etc.

300 catalogues has enabled Bibliophile to built a unique digital archive of over 60,000 book reviews which are being added to at the rate of some 3,500 a year. As vast majority of titles are no longer in-print, the Bibliophile review may be now be the only independent blurb available and of course Bibliophile knows the sales of every one.

Bibliophile is very conscious of the environment and this was a further factor in it being granted a Royal Warrant. It minimises waste by ensuring that the fewest possible catalogues are printed the mailing list is routinely pruned and controlled to ensure non-buyers, deceased and gone away addresses are not mailed. The catalogues are then despatched on a 4-7 day service in bulk, never priority as this has an inherent additional environmental impact.

Bibliophile isn't the model for the independent bookshop but does three things very well and which all can learn from; it does what it says on the door 'sells books', it knows its customers and it was built on 'everyday low pricing'.

Visit the web site Bibliophilebooks.com
View the latest catalogue:
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Previous catalogues

What is an App and what is an eBook?

What do apps and ebooks have in common and what do they have that makes them different? When is a book an app and an app a book?

At first the answer appears simple and straightforward. An app is a program that you download onto your smartphone or tablet that is interactive, informative and is cheap. Many apps soon start to become essential real time essential information feeds to navigate, inform and entertain us they are like real time applications. An app is a self contained unit it may go elswher to get its content and information but everything is rendered within the app. An ebook is a digital book and for the vast majority are no different to the physical book and even contain the same black pages. The ebook is a lower level container of content that can hold multi media but goes elsewhere to render it on a digital device.

They are very similar, or can be very slimilair and may be viewed as different digital containers.

As we wrote earlier this month the rights issues are also very similar and can also create new challenges.

Enter Apple who not only introduced the app but also would like to own the term exclusively. We have seen them build their walled app garden, first demanding 30% on all revenues , then dictating the development tools to be accepted, then launching their Apple only authoring tool, and now find them attempting to redefining the ebook.

Apple are trying to define the difference between an app and an ebook. They have informed some creators that their enhanced ebooks are in fact apps because they contain moving animation and images and have been enhanced!

If this is a misunderstanding from Apple then we move on. However, if they have really started to separate ebooks, enhanced ebooks and apps then we could be in for some ambiguous times. We have to also be aware of the price point differences between apps and ebooks and therefore some would suggest that enhanced ebooks should cost more than ebooks and certainly more than apps.

It’s somewhat ironic that a company who has such a long and loyal media and creative following is apparently trying to now convert them into serfdom and shackle them to their iWare. Apps and ebooks have to be platform agnostic and media enhancement does not make an ebook an app.

Source article: Apple's iBooks And App Store Price Out Creativity

Does The Kindle Touch Pass the So What Test?

Amazon is launching its Kindle touchscreen e-reader in the UK, Germany, France, Spain and Italy on 27th April but there is still no news on its Fire tablet.

The Kindle Touch will not be discounted with adverts and users will still not be able to lend ebooks as in the US. So for some £20 more you can touch but no lending, so is it worth it when the existing Kindle does the basics well and we all know Fire will arrive soon?

The touch device does have a new web browser, which works with wi-fi and lets users to find related passages in a book as well as more detailed information from Wikipedia and Shelfari. It also allows books to be read in both portrait and landscape mode.

So maybe it’s a buy for those who desperately need an ereader and can’t wait for Fire, haven’t heard of Barnes and Noble and its Nook, can’t work out what WHS is selling amongst the ‘stack ‘em high’ shelves, don’t believe Waterstones can or will effectively deliver digital and don’t want the often redundant luxury of the iPad.

Game Over!

As we watch another media High Street outlet chain stumble and fall we have to ask if there is a retail future for digital media on the High Street? This may sound a very stark viewpoint but digital has changed and challenged many brick and motor stores and there are far more losers than winners and the street is becoming littered with fatalities in music, video, books and games.

Does the public want to search in-store when it can search online and get instant gratification? Do the staff in-store really want to sell something that many perceive to be eating their lunch? We have seen some bad examples of retailing of ebooks and devices in-store, but perhaps the point we have missed is that online shopping is becoming social and brick and motor is often now the opposite an interesting could be seen as anti social. This may be hard to understand as we often go shopping with others, but we don’t go shopping with potentially everyone we know in our trusted communities.

Today video games specialist Game has officially entered administration and this is expected to result in heavy job losses and the closure of up to half the it's 609 UK stores. Last year it had sales of £1.6bn but many factors have caused the demise of Game. It has not been helped by a slow down in new games from major suppliers such as Electronic Arts and Nintendo. It has also had challenging cashflow and profit issues whilst it tried to clear high rents, wages, suppler and tax bills.

So as Waterstones readies itself to launch its ereader and step up to the digital challenge we would question how it will fair. Barnes and Noble have shown that digital can work if viewed as somewhat separated from stores. Indigo happily let KOBO plough its own furrow. However looking at the retail digital in-store offers in the likes of WHS makes us beg the question of whether clicks and motoer works in this new social world.

So What Do Think Social Networks Can Offer?

Nobody today can compete with the likes of Amazon. They have the economies of both scale and scope and the market share that makes them effective category killers. We may not like it, but that is reality and trying to take them on with a price offer, isn’t going anywhere.

So how do you compete, how do you differentiate in ways that make it hard for them to compete?

You may decide to withhold your books and given that there is only one source of any work, this could look logical. However, the consumer tends to be fickle and with more books on the virtual shelf it may be easy to choose a substitution work. The question is whether you can you afford to turn your back on those sales and so cut off your nose to spite your face. We suggest that Amazon is the prime channel of choice for many consumers, so it is a case of working that to your advantage and not turning your back on it in some false delusion of power and influence.

Amazon is good at service, pricing and relating customer viewing and offering options based on buying habits. It is the online WalMart and Tesco and has resource and reserves to fight any price war. Unlike Apple and Google this is its business and one it knows very well. What it is surprisingly bad at, is social networking. It wasn’t built for social networking it was built to sell, upsell, give great service and value.

Imagine for a second that they owned Twitter or Facebook. They would then know not just what you were looking and bought but also all your interests what your friends were interested in. They could build a profile of your interests which was not just based on specific product form or offer but on all your widest interests. Does Amazon know what I saw at the cinema last night, or what concert I went to, or what programme attracted my attention or that I have a real interest in a subject that goes beyond books? Does Amazon know who my friends are and what my circles of interests are?

Imagine being able to trawling social information and link real interest to product. Now imagine being able to do that within the social ecosystem itself and without having to leave it. Now imagine creating value added offers that were only available through that same social ecosystem and at high ticket added value prices. Leave the commodity stuff where it is today and focus on the high value add tick and community lock in. This is not about exclusive works but exclusive offers. Secondary rights may lead to richer pickings when primary rights become commodity priced. In the late sixties, George Martin claimed that the album was the menu and the concert was the meal.

Many do not have the resources to even start this approach let alone execute it but maybe that much maligned word – collaboration is the key. Social networks are a lot more than building chattering communities of noise. Today many advocate social networking as the next best marketing tool but often fail to see the bigger opportunities just the eyeballs and chatter.

Spotify Continues to Grow

We have tracked the rise of music on demand service Spotify not just because of its impact on the music industry but also because we believe that media on demand services are relevant to all publishing sectors and the model makes sense.

Last year Spotify took their service to the US and also tied its service in with Facebook. The results are significant not just in terms of subscribers but in the company’s rise in valuation. When it entered the US market it was valued at $1.1bn today the market is estimating its value at some $4bnoiis seeking to raise money from private investors in a deal that would put a valuation of as much as $4bn. It is put into perspective when you realise that Warner Music was sold for $3.3bn only last year!

The Spotify model is still to win over the traditionalists and the industry remains divided on whether subscription streaming services can overtake outright sales but for an increasing number of consumers the writing is clearly on the wall.

Spotify still faces huge challenges with licensing getting harder and more costly, profit still in the future and an industry that is nervous about the change in models.

What Did Amazon Ever Do For Us?

In the 'Life of Brian' there is a scene where the Jordanian Liberation Front ask the question, 'what ever did the Romans do for us?' We found ourselves asking the same about Amazon and answering with the same overwhelming reality - a lot. There are clearly lessons to be learnt.



Yesterday we were alerted by an email from iBookstore, to the new Jo Nesbo thriller 'Phantom'. We immediately went to Amazon to check availability and pricing for the ebook. We thought we would look at the competitive offer in the UK. The following screen shots from Waterstones, WHSmith, Amazon and the Book Depository. They clearly informed us where to buy the ebook and within seconds its was downloaded.

We don't aim to list the errors or poor presentation issues we saw but clearly there is a huge gap the approach to selling and the perception of what the consumer may want to know. Amazon were the only ones to list all the renditions (ebook,hardback etc) on the same page and link to these individual options. They were the only ones to give us a sample of the book and even a promotional video. They, as you would expect won on price, but also clearly stated the RRP, saving and sale price. There was even disparity between the various offers as to what the ebook RRP actually is, which in the eyes of a consumer may be very confusing. Within seconds we had it downloaded our copy.

The screen shots are below so judge for yourself and ask what would the consumer make of this?

Waterstones seperate offers: Note the higher ebook price and the ebook RRP.




WHSmiths again can't relate to deferent renditions of the same title and discount the ebook but forget to tell us by how much!




The Book Depository don't have ebooks? However there appears to be a problem with their metadata on pricing



Amazon has clear pricing comparison, understands that there are several different renditions and even collects pre sale orders of the paperback! Also they have Search Inside and a promotional video which must be available to all. The consumer still gets confused as to what the ebook RRP actually is!





Finally, if you are still unconvinced have a quick look at the screen shot for the Nesbo title 'Headhunters' at Waterstones and ask which rendition you would buy?

Government Incentives to Culture?

Does the state take the lead and define our culture and social attitude through law and taxation, or do we use the ‘free market’ to shape it and the state is merely there to protect it? We now face many challengers as we cross the many uncharted digital waters, but who should take the initiative and when is it time to act and when is it time to go with the flow?

We have seen the ill conceived Google Book Settlement unravel before us. Conceived behind closed doors by the few, for the perceived good of the many, it failed the ‘people test’ and the law. We are seeing a similar situation with the ‘agency model’. We still have copyright laws built for yesterday that are incapable of dealing with today’s digital demands. We often still see digital in its many forms; text, moving image, still image and audio and don’t see these as mere stuff within new digital containers.
Today the French have taken bold steps to change or some would suggest, ‘nationalise’, the copyright of 20th century works. It is a brave move, but one that is fraught with many of the issues that brought down the Google Settlement. Grand public policy is one thing, detail is often another.

We have taxation rules that are inconsistent across countries and states not just in what is taxed but also the level of tax applied. We have tax revenues being spent inconsistently and some would suggest we often find ‘culture figureheads who are little more than financial gatekeepers’.

The French government under the leadership of its Minister for Culture, Frederic Mitterand, has drawn up list of 13 publishing industry related proposals aimed at controlling the direction of the market. Some would welcome this initiative and applaud the proactive stance. Others would question whether the children have now taken over the chocolate factory.

The first proposal is to tax ‘large’ booksellers in order to help French independent bookstores. This ‘Robin Hood’ tax would apparently be applied not only to books sold online, but also those sold in larger physical stores, with the proceeds then going into a fund for smaller booksellers. There is nothing wrong with taxing the ‘rich’ to help the ‘poor’, but does this ‘richman’s tax’ make sense, or is it ideology over logic. Would it not be wiser to give some tax breaks to the independent group across the marketplace and so reduce their levels of tax and state interference than impose penalties for success? Everywhere has a slimilair situation but Tax revenues are created by promoting success and generating trade not by stifling it. The more tax generated from all the more you can do to relieve those who are being disproportionally taxed today. The acid test is whether the tax is in the consumer interests or whether it is just playing to the lobby.

The French proposals are also believed to include greater monitoring and control over how books are priced when sold by the bigger companies. The French government has also raised the issue of taxing ISPs, mobile operators and large internet companies. These policies raise the question of whether they are protecting culture or merely looking for soft ‘rich’ tax targets.

This week we saw the lobbing of the UK government to lower or abolish the tax on ebooks. The logic is sound and a tax of zero against one form and one of 20% for the same content begs the question of consistency. However, the same inconsistency applies right across Europe. This questions whether the taxes are in fact holding back the digital market or merely a legacy from earlier digital media taxation on music, video etc? Would ebook prices drop by 20% overnight if the tax was removed? Is the back lash driven by the consumer or by the industry? We believe that the needs to be tax consistency, but that more thought needs to be given as to how it is lobbied for and how consumer empathy and support is created. As we start to mix more digital media into the ebook and app containers does all media become tax free?

We feel a greater challenge is one where Apple and Amazon can set up their stall in Luxemburg, not just to benefit from low digital taxes, but wider corporate tax benefits. States often create their own rules and incentives and we have the recent debates over New Jersey’s sales tax incentive for Amazon to set up a distribution hub in the state in order to get tax benefits. These corporate tax incentives are difficult to compete against and only usually apply to the large corporate.

So which came first the chicken or the egg? Who should lead our digital cultural revolution and shape its usage, taxation, copyright protection, price? What should the balance be between private and public and how do you control a global private sector in a local public and government environment?

So who Owns the eBook and App Rights?

We think that we know everything about the rights that we own, or licence. We attempt to control their usage and licensing and yet find ourselves constantly looking over our shoulders and wary of increased infringement and outright piracy. Has the emergence of the multi platform app and maturing ebook market now made this even more complex?

An app and an ebook are not themselves content, but mere digital content containers into which we can now pour and mix digital stuff. These mixes can contain text, audio, moving image, still image and interactive content and present the subject in brave new ways. They not only start to reshape the content itself, but also how we interact and access it.

Until these new containers arrived the various forms of content usually stood by themselves within their own containers and ecosystems:

• Text lived within books, journal, magazines, newsprint etc.
• Audio lived within CDs, vinyl, MP3 files etc.
• Moving image lived within DVDs, Video, TV, film etc.
• Still image lived within galleries, books, etc
• Interactive lived in application software, education solutions, games, assessments etc.

The second opportunity that these new containers gave us was to democratise creation in a way not previously possible. Not only can anyone now create a new work and distribute it by several different digital channels to literally anybody, but anyone can also remix, sample and produce new content in ways not previously possible. We now have a level playing field which may nbot be apparent to many but is very real to the new entrants both large and small.

We have seen the explosion of blogs and social networks, full of snippets of content and that some would suggest can stretch the usage of ‘fair use’ to its limits. We are all now familiar with the music sampling culture that is ingrained into some music genres and culture. We have seen the emergence of multi media works which extend sampling and mix it with original content to create a new work. We have started to see living works which redefine the term ‘finished’ and even ‘edition’. Content is changing and is exploding.

These new digital containers are not just a vehicle for the established ‘publisher’ content but now can become a vehicle for all and start to redefine distribution, sharing and the digital content itself. So what happens to the rights associated with the source content and how does it relate to the new work within the container?

Rights are about usage, licence, geography, commerce and permissions. Does the usage of snippets fall under permissions or fair use? How do you find out what is fair and what is infringement? How do you establish ownership and licence? How do you reward creativity when it is part of the new digital work which may well be sold at a price lower that the digital content itself? When these containers are global how do you establish restrictions let alone enforce them?

Today we have various DRM positions being adopted in the various sectors with some being DRM free, whilst others are becoming DRM restricted. Will this mixed approach now inhibit the use of some materials, or promote some to further question DRM and to break it?

What is clear is that rights are getting a whole lot more complex..

When is it Sale and When is it a Licence?

All publishing and media sectors are constantly looking over their shoulders at not just the dynamically changing technology, but also the impact of digitisation on other sectors.

The music sector’s contract and reward system is once again being tested by artists who believe that they have not been correctly rewarded in the iTunes digital world. Twenty years ago, lawyers could not have imagined innovations such as the iTunes Music Store, and in certain contracts, it's now unclear which royalty rates apply. The issue is about the definition and associated reward of ‘sales’ versus ‘licences’. The norm is for digital sales to attract between 10 and 20% payment, whereas licence sales can attract higher payments up to 50%.

So the question is what is a sale and what is a licence?

Steve Jobs, once published a piece titled "Thoughts on Music," in which he principally talks about the move to DRM free (worth a read in itself). In the piece he says, ‘Since Apple does not own or control any music itself, it must license the rights to distribute music from others, primarily the 'big four' music companies; Universal, Sony BMG, Warner, and EMI.’ These words are now coming back to be used today against the music companies.

The first legal test case was brought by Eminem’s management FBT Productions who claimed that they were due not the 12% royalty revenue from digital sales paid by Universal Music, but 50%. FBT argued digital sales are not "records sold" but constitute a licensing of master recordings which entitling them to 50% of net receipts. The claim was upheld then rejected by the courts in March 2009, but now has now been overruled on appeal. The court found that the contracts were "unambiguous". The case is now opening up a stream of slimilair claims and legal actions and the FBT's case against Universal alone is worth $17-20 million in disputed royalties and could cost the label twice that over the next decade.

Thousands of artists signed their deals before iTunes. The Allman Brothers and Cheap Trick also filed a lawsuit against Sony BMG which was settled out of court. Pink Floyd's recent lawsuit against EMI also included the issue of the royalty rate of downloads and was settled behind closed doors. Now the Temptations are among a growing number of artists suing Universal Music. The Temptations class action is not just aimed at iTunes revenues but that from others including Amazon.com, Napster, Rhapsody and ringtone providers by such as AT&T, Verizon, Sprint and T-Mobile.

As we move increasingly into the digital world and from outright sale to a digital licence we have to ensure that there is a common understanding of both the associated rights and rewards. In this new world of ‘net receipts’, ‘walled digital gardens’ and often ‘honesty box’ trading, it may not be enough to assume a common understanding exists and like Universal and others, surprises can prove very expensive.

Related posts: March 2009 'Should music contracts reflect Today's Digital World'

April 2007 'Eminems music publisher sues Apple'

Encyclopaedia Britannica Stop The Presses

Encyclopaedia Britannica have announced what we all thought had already happened and that it will cease production of its printed 32-volume Encyclopaedia. Encyclopaedia Britannica remains the oldest English-language encyclopaedia being first published in Edinburgh 244 years ago, between 1768 and 1771. The original three volume set grew in size and reputation and became the first encyclopaedia to adopt "continuous revision", where every article updated on a schedule.

The migration from print to digital was an obvious early route for heavy reference works such as encyclopaedias. After all users wanted up to the minute information not material that was often out of date the minute it went to press. The writing was on the wall after the successes of Compton's Multimedia Encyclopaedia in 1989 and The New Grolier Multimedia Encyclopaedia in 1992 both being quickly followed by Microsoft’s Encarta in 1993. Microsoft cut corners by purchasing non-exclusive rights to the Funk & Wagnalls Encyclopaedia and incorporating the material into its first edition. Encarta changed encyclopaedias and by 2008, the, Encarta Premium, consisted of more than 62,000 articles, numerous photos and illustrations, music clips, videos, interactive contents, timelines, maps and atlas, and homework tools, and was available by yearly subscription or by purchase on DVD or multiple CDs. In March 2009, Microsoft announced it was discontinuing the Encarta disc and online versions. The MSN Encarta site closed on December 31, 2009.Microsoft continued to operate the Encarta online dictionary at dictionary.msn.com until 2011.

Wikipedia changed the market again when it was launched in January 2001 by Jimmy Wales and Larry Sanger by creating a free, collaborative, multilingual Internet encyclopedia supported by the non-profit Wikimedia Foundation. It now has 21 million articles, written collaboratively by 100,000 regularly active contributors the world and edited by anyone with access. It is now the largest and most popular general reference work on the Internet and has an estimated 365 million readers worldwide with some2.7 billion monthly pageviews from the United States alone.
Then there was Google the definitive and de facto search engine.

Britannica today only derives some 1% of it revenues from the printed encyclopaedia rendition and its online version, which was first published in 1994, represents only 15% of Britannica's revenue. Britannica now generates some 84% of sales from education materials and is planning to relaunch it encyclopaedia site to add more social connections and interactivity.

So in a period of less than two decades the face of reference publishing has changed dramatically not just with respect to the finished, or living form, but how it is managed, edited, developed, marketed and the price paid for it.

PayPal Redefines PayPorn - Again

Having initially fervently defended their position the online payment service owned by eBay Inc., has no changed its policy on not processing sales of e-books containing themes of rape, bestiality or incest.PayPal, has actually learned the hard way what many already knew – that no entity today can impose censorship outside the law and if they do they will find potentially mountains of bad press in the social network space.

They have now stated another new policy that will only ban individual titles of e-books that contain potentially illegal images and text only ebooks containing child pornography themes. To many this is still a half baked position and one that could leave PayPal and its owner eBay in danger of further embarrassment and definitions are still open to interpretation and not necessarily supported by the law.

The reversal is in part due to the pressure applied not just to PayPal but to the main credit card companies who had obviously found themselves in a world of double standards and hypocrisy..

Doug Michelman, global head of corporate relations for Visa Inc., has stated that "Visa would take no action regarding lawful material that seeks to explore erotica in a fictional or educational manner." A MasterCard spokesman stated that it "would not take action regarding the use of its cards and systems for the sale of lawful materials that seek to explore erotica content of this nature."

Our original post: PayPal Bans Porn

Can TED ED Capture and Share the Best?

TED has enabled many great speakers, their vision and thoughts to be shared across the globe. Many would have never known about the likes of Pranav Mistry’s Sixth Sense without TED Talks. The eloquent education evangelist, Sir Ken Robinson has reached millions through TED and has been viewed over 11 million times and continues to be watched by more than 10,000 people every day. TED has changed the way we can hear the best speakers, scientists and business leaders.

Now the service is extending itself into the educational space with a TED-Ed YouTube service. Its approach may well recreate those magical Faraday Lectures that engaged so many students in the past and ensured the best and most gifted teachers engaged with the widest audience to create life long learners. Together with Salman “Sal” Khan’s Khan Academy, they start to question the way we use technology to engage and educate and remove those physical constraints that have often restricted learning. The Khan Academy is now backed by the Gates Foundation and Google, and is starting to find an audience.

TED-Ed has taken a few wise steps in this new programme. It has created; a submission process that can be vetted, a capturing facility enabling the best teachers to be caught on the internet, a short form lecture that is focused on 10 minutes and an opportunity for the best graphic artists and animators to plug in and help augment the basic content into an absorbing lesson. TED is committing to producing hundreds of videos a year but unlike others, sees it self as ‘helping teachers’ and not claiming to replace or transform education into a video and digital streamed world.

So is TED-Ed becoming an educational publisher? What is different to what they do to what the likes of Pearson and others do? Is it in fact now competing head to head with TV educators such as the BBC? Will other teachers use the material to compliment their own or view it as a gimmick, a 10 minute sound bite and nothing more? Will sufficient material be posted to offer real depth and will there be sufficient range of material to cover all subjects? Will the graphics match the words and engage?

TED-Ed aims high and there is no reason why it will not attract the best teachers and give them the unique opportunity to educate not just the few but the masses, not just in one school, city or country but across the glob enabling them to engage, inspire and open students reception to learning. It however steers away from creating entire curricula on video choosing instead to compliment curricular with those engaging moments that leave the student engaged and wanting to learn more.
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TED-Ed has posted a small number of lessons aimed at engaging the teachers so they can participate and create hundreds more. The videos are based on using the teacher’s words and giving them that extra dimension through the overlay of the best animation.

TED was an opportunity missed by traditional publishers who often saw it as a speaker conference forum and not as a education and enlightenment platform. They didn’t grasp the model and its potential we wonder if they same will apply to Ted-Ed and whether in a few years we will all be experiencing the rebirth of the Faraday lecture via 21st century soundbites.

Watch some TED-Ed videos and make your own mind:
How Pandemics Spread
The cockroach beatbox
How containerization shaped the modern world
David Gallo on Deep Oceans
The Power of Simple Words

US Libraries to Take Ownership of Digital?

We have to respect that there are only so many hands that can access the till before it becomes uneconomic. One of the challenges faced by public libraries and bookstores is that they are totally dependant on the digital aggregators and service providers for the supply of content and a digital platform. Instead of investing in growing their own infrastructure they opted to leave it to others and then are surprised when those same players threaten to sidestep them or end up having the real relationship with the consumers.

Why did the Bookseller’s and Library bodies not build their own service, to both host digital files and service them to their members? Why did they effectively role over and leave it to others to grab the space? It was potentially on the agenda, but often dismissed as not being ‘their’ businesses. Was this a wise move?
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Last year the Douglas County Libraries in Colorado started to take control of their own content and this has attracted much attention and is being watch by other libraries and publishers in the US. Douglas County have started to purchase ebook files directly from publishers and host these on their own Adobe ACS4 Content Server and serve them up directly to their communities. The Califa Group, which claims to be the largest library network in California, has now decided to follow the same route.

Once a member has been authenticated they will be able to borrow ebooks in the EPUB format that will work on a variety of devices. There may also be links provided to buy ebooks.

The libraries are also working on the legal framework that was produced with librarylaw.com, which is not a formal contract but based on documents that spell out terms of engagement with publishers and avoids costly and time-consuming contracts with each publisher.

A “Statement for Common Understanding for Purchasing Econtent,” asserts the library’s rights under the first sale doctrine of the Copyright Act:
The Library may lend a copy to a library user under First Sale 17 U.S.C. Sect. 109. The Library may make incidental copies as necessary to perform the lending function. The lending copy is an ‘evanescent’ copy that disappears after a set period such as two weeks. During that time, the copy is not available to any other party. Incidental exercises of other lawful rights constitute non-infringing ‘fair use.’

It also affirms the library’s obligation to safeguard the intellectual content of a copyright owner:
The Library may not make multiple unauthorized copies to sell or lend. The Library may lend one copy to one user at a time. For example, if the Library buys four copies of a work, it may lend four copies simultaneously. It may not make derivative works, such as translations or movies. These are exclusive rights granted to the copyright owner 17 U.S.C. Sect. 106.

The framework also describes the library’s need to own (not lease) files, the library’s digital rights management system and the case for traditional library discounts to be applied.

The library market’s ability to act in a consortia manner may add another dimension as they are able to share contract deals with publishers, code, interfaces and much more re experience and for smaller publishers this may prove a real opportunity. Although it sounds straight forward and logical this is still just a small initiative which still faces interesting challenges and many potential push back.

So How Do You Reward The Author?

At one end of the value chain we have ebook pricing, which today is in need of a sustainable model that is in the consumer interest. After all, they are the final arbitrator and the only one who actually puts real revenue into the chain. At the other end, we also find a similar need for a sustainable reward model, which is in the long term interest of the author. After all they are the ones who actually create the work and its value.

We have long stated our views on agency and its flawed position. Some have claimed that without agency, the future is bleak, prices will fall and the rewards for authors will be impacted. Whatever position you think is right, the future of agency will be addressed by the Department of Justice and EU investigations and filed class actions. Irrespective of the outcome, the question of author reward should be debated and is not just tied to any one model.

We have seen the drop in advances and the pressure on established authors to grant ebook on their back list. We have also seen the ebook self publishing model change, with the likes of Amazon, Barnes and Noble and others offering large incentives to authors to publish, both backlist and new titles with their services. The percentage of reward offered by publishers on ebooks has also gone up and down like a YoYo.

So what should an author earn on ebooks? Does an ebook have to be tied to its pbook or abook renditions? Where are the added value steps between the author and the consumer on ebooks?

Last week we also listened to a good friend, who is an published author and who told us about an aspiring author‘s manuscript that they had been given to read. They said the work was very good and a well constructed 'page turner', but that they were lost as to what to say to the writer. Five years ago they would have lined them up with an agent introduction and pushed them towards the traditional publishing route. Today, they feel that the rewards have changed dramatically and although the model still works for many, the odds on new authors making it are increasing and they believe, ‘its growing impossible for authors to make a living out of writing alone.’

The ebook itself is potentially changing the relationship between the author and the others who sit between them and the consumer. Yesterday the rights were often traded on a ‘performance related’ model. If the work wasn’t shifting, the rights could revert. Yesterday, there were often separate rewards for unit sales, special ‘book club’ deals, and the royalty statement could be tied to production, inventory and sales. Today, we increasingly see ‘net receipts’ and in the digital world, ‘honesty box’ sales and receipts. We do not doubt the sales reported but it would be interesting to see who has fully audited their digital sales and established that the money paid relates to the sales achieved?

We also have the question of rights being reverted. Contracts may still tie the pbook break clause to performance, but does this extend to ebooks whose inventory is now virtual and now exists within a ‘long tail’ marketplace? Are ebook rights becoming perpetual deals? Why aren’t ebook’s rights term based and fixed and renewable on say a five year basis? This would not only remove perpetual deals for the life of the copyright but it would make sense in a marketplace which is rapidly evolving and where it is often difficult to predict next year, let alone twenty or thirty years out. Today, an author can not only be tied to an agent’s deal for life but increasingly, the publisher too. Let’s hope that they don’t ever fall out!

Permission rights will become increasingly important in the digital market, but how are these rewarded and itemised on that royalty statement, let alone calculated and recorded?

We also have the question of payment schedules. It was understandable that royalty payments on pbooks took time. But in today’s real time payment transaction world where all ebook sales should be firm, does to same ‘banking’ delays and reconciliation make sense? It is interesting that the agency model agreed the commission split upfront, but irrespective of that simplification of the division of revenue, the money flow remained slow to the author.

Marketing and promotion can be one of the greatest value added services provided by a publisher. In the physical mass market world this was relatively easy to define and could even be written into the contract, but does this still work in today’s mixed market and how will it work in tomorrow’s digital direct market? As publishers move to a more direct marketing position will the exposure and spending gap between the ‘celebrity author’ and the rest widen? Does the publisher see the author, the work, or themselves as the brand tomorrow and how is that reflected in the marketing spend?

We now have the emergence of the rental model, which as in music and other media, often has a consumer appeal. Not only can this be at title level, but also incur a subscription across collections. How will this be reconciled moving forward?

Advertising revenue driven models are now starting to take hold within other sectors but how will they be reconciled to reward authors?

There are beacons of light for authors and we applaud the Simon and Schuster new author service and believe that transparency of marketing, sales, and reward is the only way forward.

Finally, we have the question of what should the author be paid on their digital sales. Some suggest a bit more than the physical sales, some stick around the 25% mark, some go higher and then we have the self publishing levels where the majority of revenues flows to the author. These are mere numbers and meaningless unless tied to performance as it is better to earn on a lower percentage and sell volume than earn on higher percentage and sell few.

So how do you relate performance and reward in digital rights contracts moving forward?